There’s a bit more hopeful cleantech news coming out of Australia. This time it concerns efforts to accelerate EV adoption in New South Wales (NSW). Nash from Tesla in the Gong has shared a breakdown of what this could mean for Tesla and other EV makers in his state. “New South Wales government here in Australia has proposed a new EV strategy,” Nash said, then noting he is going to dive into the details and answer some of the frequently asked questions.
The new EV strategy will help expand the state’s EV fleet, and NSW is making a few strategic proposals.
- Rebates for new EV purchases.
- Phasing out of the stamp duty for EV purchases.
- Lead incentives for local councils and businesses to buy EVs instead of ICE. (Electrifying NSWs government fleets.)
- A fair and sustainable road user system
- Fleet incentives
- Invest $171 million ($AU) to build EV charging infrastructure
Rebates For New EV Purchases
Starting on September 1, 2021, NSW will offer $3,000 Australian dollars ($AU) of rebates for the first 25,000 new battery-electric vehicles and hydrogen fuel cell cars purchased for a price of less than $68,750 $AU. This includes the goods and services tax (GST).
No Stamp Duty For EV Purchases
There will be no stamp duty payable on EV purchases starting on September 1, 2021. Purchases of new and used EVs and hydrogen fuel cell vehicles purchased under a price of $78,000 (includes GST) will not have to pay a stamp duty.
“This in combination with the $3,000 if you are eligible for the same will put about $5,540 Aussie dollars back into an EV purchaser’s pocket is what the government promises.”
Electrifying NSW Government Fleet
The NSW government is proposing a commitment to electrify its existing passenger vehicle fleet by 2030. Its current fleet has 12,000 cars.
“We have been talking about all of this in the EV podcast Phantom Lane 4 for many a month now and finally it looks like the New South Wales government has taken consideration of all those. But this, they say, will send a strong signal to manufacturers that New South Wales EV market is open for business and I think Tesla with its amazing presence already in the state will stand to benefit from this.
“It would be awesome if Tesla and Elon Musk will work with the local government to set up a much stronger EV presence in terms of manufacturing and deployment of services, which will, in turn, bring more jobs to the local market. I’m quite simply excited about this particular prospect.”
A Fair & Sustainable Road User System
Nash noted that this idea has been a focal point of debate. The goal here is either when new EV sales reach greater than 30% of all new vehicles or starting on July 1, 2027, that there will be a fair and sustainable road user system charge added on EVs. The charge would be 2.5 cents per kilometer and the government stated that the average petroleum or diesel vehicle owner would pay around $613 annually whereas the average EV owner will pay $315 annually.
“This is a debatable one but given the rest of what the EV strategy entitles it seems to be okay in my humble opinion.”
The fleet incentives for local councils and businesses have been promised previously as a part of the NSW Net-Zero Plan 2020–2030. This plan noted that incentives will be offered to support medium to large-sized fleets. Local councils, car leasing companies, and car-sharing companies would benefit from purchasing battery EV or hydrogen fuel cell vehicles through a reverse auction process that ensures that the government will maximize value for money.
Invest $171 Million ($AU) To Build EV Charging Infrastructure
NSW wants to build a world-class EV charging infrastructure and has committed to investing $171 million ($AU) over the next four years.
“They say at every 5 kilometers at Sydney’s major commuter corridors there’ll be an EV charger. There will be one charger on average every 100 kilometers on a major highway in New South Wales. And there’ll be a charger within five kilometers of residential areas with limited off-street parking, as well as in and near commuter car parks there will be chargers. Now we do not know what the nature of these chargers are. We’re still awaiting some of the details from the government in the near future.
“This is where I think Tesla, as well as some of the existing players like Charge Fox and Evie Networks, stand to benefit, because they, I would believe, get some sort of support as a core funding for setting up the infrastructure. Now with rolling out of the V3 Superchargers in Victoria as well as in Tasmania, this, I feel, will positively impact the adoption of EVs here in New South Wales.”
What EVs are eligible to receive a stamp duty exemption?
All new and used battery-electric and hydrogen fuel cell vehicles that were purchased for less than $78,000–including GST–are eligible for a stamp duty exemption starting on September 1, 2021.
“This, I think will definitely help Tesla to establish a massive second-hand car market as well,” Nash explained.
He pointed out that those who own a Model 3 and would like to upgrade to a new Model 3 or even a Model Y when it becomes available in Australia will benefit from the stamp duty exemption — and so will those buying the used Model 3 from the owners wanting to upgrade.
What is a RUC and when does it apply?
As previously mentioned, the new road user charge could start either in 2027 or when new EV car sales reach 30% of all sales in NSW.
Why is NSW introducing a RUC?
Currently, NSW drivers contribute to the cost of road maintenance and construction — through a mix of fuel excise charges, stamp duty, and registration. As EV uptake continues to grow and fuel excise declines, the government needs to set up a fair and sustainable system that will ensure it has ongoing funds to support its roads.
Side note: compared with the U.S. and its various states’ takes on EV taxes, I think the RUC proposed by NSW is rather fair. They are not punishing EV owners in the way that many states including my own have done or are trying to do. If this model proves to be successful, I think the U.S. can learn from NSW.
Access To T2 & T3 Lanes
Another incentive that Nash pointed out was that EV owners will have access to T2 and T3 lanes. These are transit lanes that are similar to our HOV lanes over here. One of the common rules is that for HOV, a car has to have two or more people in the car. T2 lanes must have 2 or more people in the vehicle and T3 lanes must have three or more people in the vehicle. (This includes the driver.)
EV owners will be exempt from these rules , so even if you are the only person in the vehicle, you will be able to use these lanes as long as your vehicle is a battery electric vehicle or a hydrogen fuel cell vehicle.
Tesla Vehicles Eligible For The NSW Rebates & Incentives
Not all Tesla vehicles will be eligible for the new rebates and incentives program. Nash gives a quick rundown:
“Well, for now, that is only the Model 3 SR Plus, and that, too, is only for the stamp duty because the Model 3 SR price has a drive-away price of $70,108 here in New South Wales. So, it may not qualify for the $3,000 rebate because it is a sub-$68,000 that qualifies for that rebate.”
Nash noted that there is still a savings of around $3,000 from the stamp duty exemption. Nash shared that he wishes that Tesla could do something to bring the price down just enough to qualify for the new rebates.
“Maybe Tesla can introduce a Standard Range car and then maybe offer the Standard Range Plus as a software upgrade after the fact if people want it.”
Other electric car models that have a chance at benefitting from the new rebates and incentives are:
- Hyundai Kona Electric
- Nissan Leaf
- MG ZS EV
- Kia e-Niro
- And possibly the Mazda MX-30.
You can watch Nash’s full video here.
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